TLDR
- Nebius Group announced a $4.5 billion convertible senior notes offering via private placement
- NBIS stock fell over 8% in premarket trading following the announcement
- The offering is split into two series: $2.75B due 2030 and $1.75B due 2034
- Proceeds will fund data center construction, AI cloud development, and GPU procurement
- The company also plans to exchange some existing 2029 and 2031 notes for Class A ordinary shares
Nebius Group (NBIS) dropped more than 8% in premarket trading on Wednesday after the company announced plans to raise $4.5 billion through a convertible senior notes offering.
The offering will be split into two series. The first is $2.75 billion in convertible notes due February 15, 2030. The second is $1.75 billion in convertible notes due February 15, 2034.
Both series will be offered through a private placement to qualified institutional buyers only.
Nebius will also give initial purchasers an option to buy additional notes. That option covers up to $375 million of the 2030 notes and up to $300 million of the 2034 notes, exercisable within 13 days of issuance.
The total potential raise, including those options, could push the figure above $5.1 billion.
How the Money Will Be Spent
The company says proceeds will go toward funding the continuing growth of its business. That includes building out and expanding its data centers, developing its full-stack AI cloud platform, and buying key components including GPUs.
Remaining funds will be used for general corporate purposes.
Notes Exchange Also Planned
Alongside the new offering, Nebius expects to enter into exchange agreements with a limited number of existing noteholders. Those holders carry the company’s 2.00% Convertible Senior Notes due 2029 and its 3.00% Convertible Senior Notes due 2031.
Under those agreements, a portion of the existing notes would be swapped for Nebius Class A ordinary shares, each with a par value of €0.01.
The move effectively converts some debt into equity, which can dilute existing stockholders.
That dilution concern, combined with the scale of the new offering, likely explains the sharp premarket drop in NBIS stock.
The stock was already down more than 6% shortly after the announcement broke, before extending losses to over 8% as premarket trading continued.
The 2030 and 2034 notes will each mature on February 15 of their respective years, at which point the original principal plus any accreted amount will become payable.
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